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Backup sources readied as calamity funding runs low

PHILIPPINE STAR/CESAR RAMIREZ

THE Department of Budget and Management (DBM) said Thursday that the contingent fund and local government support fund have been placed on standby to support the government’s dwindling disaster funds.

Concerns have been raised about the depletion of the Quick Response Fund (QRF), which can be disbursed rapidly in response to calamities. It can finance preparatory activities, relief, and rehabilitation.

Budget Secretary Amenah F. Pangandaman said as of Oct. 2024 it had P30 billion.

“Nakita po natin na ‘yung mga ahensya tulad ng DSWD at DPWH, naubos na po nila ‘yung sa kanila. So humihingi na po sila ng replenishment (We have seen that the Department of Social Welfare and Development and the Department of Public Works and Highways have run out of funding, and are asking for replenishment),”she said in a statement.

The Departments of Agriculture, Education, Interior and Local Government, and Health, as well as the Philippine National Police, Bureau of Fire Protection, Office of Civil Defense, and Philippine Coast Guard also have access to the QRF.

According to the 2024 General Appropriations Act, the balance of the National Disaster Risk Reduction and Management Fund (NDRRMF) can be tapped to replenish the individual agencies’ QRFs.

Replenishment may be requested from the DBM once QRF utilization hits 50%, the DBM said.

Ms. Pangandaman standby funds are available in the form of Unprogrammed Appropriations should the Contingent Fund would run out.

She added that agencies can request the DBM directly to tap the Local Government Support Fund – Financial Assistance to Local Government Units (LGSF-FA to LGUs).

Under Local Budget Circular No. 155, LGSF-FA to LGUs may be tapped for financial assistance to LGUs for “implementation of programs, projects, and activities for disaster response, rehabilitation, and recovery, including procurement or acquisition of disaster equipment and vehicles for disaster response and rescue activities.”

Finance Secretary Ralph G. Recto has said that the NDRRMF is nearly depleted, adding that the frozen P30-billion transfer of Philippine Health Insurance Corp. (PhilHealth)reserve funds could have been used to fund it.

“It’s almost gone. The Supreme Court TRO (temporary restraining order) of P30 billion could have been used for calamities,” Mr. Recto told BusinessWorld on the sidelines of the DBM budget deliberations.

The SC recently issued a TRO on the further transfer of excess funds of PhilHealth to the National Treasury.

When asked how to the government can fund future disasters, he said the Philippines will have a “positive cash balance by the end of the year.”

“We have agreements with the World Bank; if needed, we can use loan proceeds for calamity victims,” Mr. Recto said. — Aubrey Rose A. Inosante

Recto expects BSP to continue easing cycle

FINANCE SECRETARY RALPH G. RECTO — DEPARTMENT OF FINANCE FACEBOOK PAGE

THE BANGKO SENTRAL ng Pilipinas (BSP) is expected to continue cutting rates in the next few months, Finance Secretary and Monetary Board Member Ralph G. Recto said Thursday.

“We have cut our interest rates by a total of 50 basis points (bps), creating an even more conducive environment for growth and investment. And more rate cuts are expected in the coming months,” Mr. Recto said in a speech.

The Monetary Board began its easing cycle in August, bringing the central bank’s key rate to 6%.

BSP Governor Eli M. Remolona, Jr. has signaled a possible 25-bp rate cut in December, which would bring the benchmark rate to 5.75% by the end of 2024.

Mr. Recto told reporters on the sidelines of a conference that the BSP will review its easing cycle outlook following the slowdown in third-quarter gross domestic product (GDP) growth, but he noted “there’s a possibility” for a rate cut in December.

The economy expanded 5.2% in the third quarter, the weakest reading since the 4.3% posted in the second quarter of 2023.

Third-quarter growth marked a slowdown from the revised 6.4% posted in the second quarter, and the year-earlier 6%.

The median forecast had been 5.7% in a BusinessWorld poll of 12 economists and analysts ahead of the data release.

On a quarter-on-quarter basis, GDP expanded by 1.7%.

Mr. Recto said rate cuts could put the economy on a strong growth track until 2030 and possibly bringing the Philippines to upper middle-income status by next year.

“The Philippine economy has already doubled in size since 2013 in terms of nominal GDP. And by 2030, our projections show that we can grow by another twofold, and this has not gone unnoticed by the rest of the world,” he said in his speech.

Economic growth will also be supported by strong job numbers and slowing inflation, which will support consumer spending.

“Today, about 50 million Filipinos are employed, and 63.9% of them hold formal, stable jobs. Unemployment has steadily decreased. This is proof of an expanding middle class ready to drive consumer demand,” he said.

The labor force participation rate increased to 65.7% in September from 64.1% a year earlier. The labor force is estimated to number 51.77 million, up 1.84 million.

“Additionally, our whole-of-government efforts to mitigate food and nonfood inflation are expected to keep the inflation rate within our target band for the next two years. Low and stable prices will speed up the growth of our already robust domestic demand, with household consumption accounting for more than 70% of our economy,” Mr. Recto added.

Headline inflation picked up to 2.3% in October from 1.9% in September, but remained below the 4.9% from a year earlier. It was also within the central bank’s 2-4% target.

“With these favorable forces at play, we are on course to reach upper middle income status next year. And by 2030, the Philippines will become the 30th largest consumer market globally,” Mr. Recto said.

The Philippines was classified as a lower middle-income country with a gross national income per capita of $4,230 in 2023, according to World Bank’s income classification standards. It has been a lower middle-income economy since 1987. — Aaron Michael C. Sy

Improved quality norms seen boosting PHL pharma exports

HAL GATEWOOD-UNSPLASH

PHILIPPINE pharmaceutical exports are expected to grow further, boosted by supportive regulation that will enhance quality, Fitch Solutions unit BMI said.

“Improved regulatory standards will boost prospects for Philippine’ medicine exports, enabling expansion beyond neighboring Southeast Asian markets,” it said in a report.

BMI expects pharmaceutical exports to grow to P3.7 billion in 2028 from P2.7 billion in 2023.

The Food and Drug Administration (FDA) reformed the regulatory process for pharmaceutical and active pharmaceutical ingredient exports, in a bid to improve compliance and “rigorously assess the quality, safety and efficacy of products intended for both local and international markets.”

“The FDA decision to tighten drug exporting standards is indicative of a wider movement towards reinforcing drug safety and quality control. This elevation in standards will stimulate export growth in the medium- to long-term,” BMI said.

The report noted that the Philippines exports primarily to other Southeast Asian countries such as Indonesia, Thailand, Malaysia and Singapore.

“The outlook for export growth over the coming years is robust given its low base. Posing upside to the country’s pharmaceutical export potential is the adoption of improved regulatory standards in the coming years which will boost the potential for its pharmaceuticals in global markets,” it added.

Meanwhile, BMI expects pharmaceutical imports to grow at a slightly slower pace. Imports are expected to grow to P161 billion in 2028 from P124 billion in 2023.

“The relatively lower growth rate of imports indicates a gradual reduction in the market’s dependency on foreign pharmaceutical products as domestic production ramps up,” it added.

The government is in the process of reviving domestic manufacturing overall, BMI said.

It noted initiatives such as the FDA working with Philippines Economic Zone Authority (PEZA) to expand pharmaceutical development zones and the government’s target for the domestic pharmaceutical industry to produce 60% of registered medicines.

“We expect these initiatives to attract pharmaceutical companies into the Philippines, contributing to the growth of medicine manufacturing and R&D activity,” it said.

The Philippine pharmaceutical market is expected to grow to P414 billion by 2028 from P335 billion in 2023. — Luisa Maria Jacinta C. Jocson

IEMOP eyes full commercial operations for renewable power market by December

Commencement of the commercial operations of WESM in Mindanao at the IEMOP control room

THE Independent Electricity Operator of the Philippines (IEMOP) said it hopes to launch full commercial operations by December for the renewable energy (RE) market serving on-grid participants.

“We are preparing for the renewable energy market full commercial operations, targeted for December,” Arjon B. Valencia, manager for corporate planning and communication at IEMOP, told reporters at a briefing recently.

The RE market is the venue for trading RE certificates (RECs) equivalent to an amount of power generated from RE resources, and is intended as a facility for mandated participants to comply with their Renewable Portfolio Standards (RPS) obligations.

RPS requires distribution utilities (DUs), electric cooperatives (ECs) and retail electricity suppliers to source a certain portion of their energy supply from eligible RE resources.

RECs, which are issued to mandated participants, is equivalent to a one-megawatt-hour of RE generation at a price capped at P241 each. Renewables should account for at least 11% of the participants’ energy sales.

The RE market launched interim commercial operations in 2022 with the Philippine Electricity Market Corp. (PEMC) as the RE registrar.

“We’re expecting to have the functions transferred to IEMOP together with the declaration of commercial operations,” Mr. Valencia said.

The Department of Energy (DoE) will issue a department circular declaring the full commercial operations of the RE market, he said.

“When it comes to the scale of this market, I think the sales will focus more on the off-takers, the ECs, DUs to source or to buy from the market as they are the mandated participants,” Mr. Valencia said.

“As to our target of 35% by 2030, this market will facilitate that,” he added, referring to the goal of increasing RE share in the power generation mix, which is currently at 22%. — Sheldeen Joy Talavera

Green energy auction expected by year’s end

PHILSTAR FILE PHOTO

THE green energy auction (GEA)  will likely proceed within the year even though the pricing mechanisms have yet to be issued.

“Towards the end of this year, we should finalize the GEA for hydro pump storage and geothermal, as well run-of-river and impounding hydro,” Energy Secretary Raphael P.M. Lotilla said during the Pilipinas Conference Thursday.

Mr. Lotilla said the GEA for integrated renewable energy storage systems (IRESS) “will also be coming soon as well.”

GEA is designed to increase renewable energy capacity to help the government meet its goal of 35% renewable energy in the power mix by 2035 and 50% by 2040.

In the last two years, the Department of Energy (DoE) has conducted two GEA rounds, which generated 5,306 megawatts (MW) of renewable energy commitments for delivery in 2024 to 2026.

For 2024, the DoE plans to auction renewable energy projects with a combined capacity of 4,399 MW.

The GEA third round will cover non-feed-in-tariff (FIT) eligible renewable energy technologies such as geothermal, impounding hydro, and pumped storage hydro.

The auction will also cover run-of-river hydro, a FIT-eligible renewable energy technology.

For GEA-4, the DoE is looking to offer IRESS and liquefied natural gas.

Earlier this month, the Energy Regulatory Commission (ERC) posted the draft price determination methodology (PDM) guidelines for renewable energy technologies for public  comment.

The ERC is responsible for establishing the PDM for GEA bidders. — Sheldeen Joy Talavera

Marcos signs priority measure on apprenticeship incentives

NOEL B. PABALATE / PPA POOL

PRESIDENT Ferdinand R. Marcos, Jr. signed into law Thursday a priority bill seeking to boost  apprenticeship programs and better align them with industry needs.

The proposed Enterprise-Based Education and Training (EBET) Framework Act provides incentives for employers offering apprenticeship programs to prospective members of the workforce.

It also covers workers who want to engage in upskilling to support career progression.

“By establishing a framework on career advancement and industry-relevant skills, this law directly addresses the issues (like) the lack of formal training and skills mismatches,” Mr. Marcos said in a speech at the signing ceremony.

He said many livelihood programs at the national and local levels have been inadequate in terms of landing jobs for participants.

“That is why it is very important to synchronize our skills training with the actual requirements of industry and the labor market.”

Workers eligible for the EBET program are those who are either newly employed or established workers who want to acquire new skills.

Under the law, enterprises should give their trainees allowances not lower than 75% of the applicable minimum wage.

In programs exceeding one year, the apprentice is entitled to a yearly increase in line with labor market wage rates in the sector, and subject to evaluation of performance.

Training hours are not to exceed eight hours per day.

A trainee required to work overtime not exceeding two hours a day is to be paid an additional 25% of the hourly allowance for every hour of extra work.

Workers undergoing upskilling training are entitled overtime pay and a night shift differential, if applicable.

“We are hopeful that the law can effectively address these issues so we can prepare our workers for the demands of the local and foreign market, and assist them in finding new or additional employment so they can help their families,” Speaker Martin G. Romualdez, who witnessed the signing, said in a statement.

EBET program graduates will enjoy hiring preference in the company implementing the program and will not need to undergo probation.

EBET trainees are eligible to tap the Tulong Trabaho Fund, a component of Republic Act No. 11230 or the Tulong Trabaho Law.

The Philippine Statistics Authority reported that the unemployment rate fell to 3.7% in September from 4% in August and 4.5% a year earlier. — Kyle Aristophere T. Atienza

Philippine debt-to-GDP ratio rises in third quarter

RJ JOQUICO-UNSPLASH

THE National Government’s (NG) debt as a share of gross domestic product (GDP) was 61.3% at the end of the third quarter, the Bureau of the Treasury (BTr) said Thursday.

This was higher than the year-earlier 60.2% and the 60.1% posted at the end of 2023, the BTr said in a statement.

In 2024, the debt-to-GDP ratio target was set at 60.6%. The government seeks to bring this to below 60% by 2028.

The threshold considered by multilateral lenders to be manageable for developing economies is 60%.

“The debt ratio reflects the accomplishment of 89.5% of the full-year borrowing program to fund 2024 expenditures,” the BTr said.

At the end of September, the NG’s outstanding debt rose to a record P15.89 trillion, up 2.2% from a month earlier.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said that the rise in the debt-to-GDP was due to the increased borrowing by the NG as well as slower-than-expected growth.

The economy grew 5.2% in the third quarter, the weakest reading since the 4.3% posted in the second quarter of 2023.

Meanwhile, the Treasury said the deficit-to-GDP ratio fell to 5.1% at end-September from 5.7% a year earlier and 6.2% at the end of last year.

The indicator fell below the 5.6% deficit ceiling set by the government this year.

The Treasury reported that the budget deficit narrowed 1.35% to P970.2 billion in the first nine months.

Mr. Ricafort said that bringing down the debt-to-GDP ratio to below 60% would help “sustain the country’s favorable credit ratings of 1-3 notches above the minimum investment grade, to help better manage and sustain the country’s fiscal performance and overall debt management over the long-term and for the coming generations.”

“Achieving this would require narrower budget deficits, intensified tax revenue collection, and more disciplined government spending,” he added. — Aubrey Rose A. Inosante

More German companies in PHL see expanded investment, staffing levels

PHOTO FROM AUTO NATION GROUP

GERMAN FIRMS operating in the Philippines are projecting improved business conditions, which will cause more of them to invest and hire more, the German-Philippine Chamber of Commerce and Industry (GPCCI) said.

In a statement Thursday, the GPCCI said that its Fall 2024 survey indicated that 58% of German companies expect conditions to improve in the near term, up from 50% in the previous survey.

Likewise, 51% of the participants also predict expanded investment, against the 44% posted in the previous survey. Some 62% of the survey participants project higher employment.

“The optimism expressed by businesses in the German-Philippine community reflects our ongoing commitment to strengthening economic ties,”  GPCCI President Marie Antoniette Mariano said.

“The growth in investment and employment projections is a clear indicator of confidence in the market, and we look forward to seeing these positive trends materialize over the coming year,” she added.

However, the survey found that the lack of skilled workers, complex and unpredictable policies, and supply chain disruptions were the top concerns for German companies.

“Collaboration between government and the private sector is essential to building a more stable and predictable environment that fosters sustainable growth,” GPCCI Board Director and Policy Advocacy Chairperson Marian Norbert Majer said.

“It is crucial to address challenges like regulatory complexity and skilled-labor shortages to fully capitalize on this optimistic business outlook,” Mr. Majer said.

The survey also found that German companies in the Philippines see sustainability requirements as a positive driver in their external competitiveness, with 43% saying it adds to their competitive advantage.

“Our latest survey shows that German-Philippine businesses enhance their respective operations through diversification and increasingly viewing sustainability as a strategic advantage,” GPCCI Executive Director Christoper Zimmer said.

“Embracing sustainable practices and standards is proving essential for long-term growth in today’s competitive market,” he added.

According to the report, 48% of the companies see their competitive positions improving over the next five years. — Justine Irish D. Tabile

DLSU survives UST in five sets to clinch SSL tourney finals berth

Games on Saturday
(Rizal Memorial Coliseum)
3:30 p.m. – Ateneo vs UE (classification)
6 p.m. – FEU vs NU (semis)

UNBEATEN De La Salle University (DLSU) escaped with a thrilling 26-28, 25-19, 25-20, 21-25, 15-13 win over University of Santo Tomas (UST) to barge into the finals of the 2024 Shakey’s Super League (SSL) Collegiate Pre-season Championship Wednesday night at the Rizal Memorial Coliseum.

Former UAAP MVP Angel Canino and SSL National Invitationals MVP Shevana Laput formed a lethal duo to take the Lady Spikers home and closer to a redemption bid after a runner-up finish to back-to-back champion National University (NU) in the inaugural season.

La Salle, undefeated in eight games, will face either rival NU or fellow unbeaten Far Eastern University — which will clash on Saturday in the best-of-three finals next Friday.

Ms. Laput fired 19 points on 15 hits, two aces and two blocks, Ms. Canino had 17 on 16 attacks while Ms. Provido joined the party with 12 points for the wards of coach Ramil de Jesus.

Sister of PBA cager James Laput from Magnolia, the 6-foot-2 Ms. Laput scored four from her total output in the decider, where the Lady Spikers pulled away to 14-11 from a slim 11-10 lead.

Angge Poyos tried to unleash one rally for the Golden Tigresses but Ms. Canino fired a long bomb at the backrow for the gritty win.

“I just knew I had to step up. I had to be there for my team and be that reliable player for them. I hope that it showed in the court and I hope that my team will continue to rely on me and see me as an Ate for them,” said Ms. Laput.

“I know that it was a team effort. It’s always a team effort and not just one person who finishes the points and gets the MVP of the match. All of us are MVPs right now.”

Ms. Poyos scored 22 points, including eight in the rubber set, as Regina Jurado and Jonna Perdido had 10 each but to no avail for the Golden Tigresses, who were relegated to the bronze medal match after a runner-up finish in the UAAP and a championship in the V. League.

Meanwhile, NCAA champion College of St. Benilde made short work of University of the Philippines, 25-19, 25-14, 25-20, in the first phase of the classification round.

The Lady Blazers will battle the winner between Ateneo and University of the East for fifth place as UP takes on the loser for seventh place. — John Bryan Ulanday

Pagdanganan shares second with four others at LPGA Lotte Championship in Oahu, Hawaii

BIANCA PAGDANGANAN — REUTERS

FILIPINA ACE Bianca Pagdanganan fired a roaring five-under 67 to go just one shot off opening leader A Lim Kim in the Lotte Championship Thursday in Oahu, Hawaii.

Ms. Pagdanganan gunned down six birdies in the first 11 holes of the Hoakalei Country Club to grab a share of the lead early on. And though a bogey-bogey mishap in the 16th and 17th — both par-4s —pulled her down, the power-hitting Pinay recovered one stroke in the par-5 18th to move up to joint second and stay within striking distance of Kim.

The two-time Olympian shared No. 2 with Chinese Ruixin Liu, German Polly Mack, French Perrine Delacour and Taiwanese Peiyun Chien.

Ms. Kim, the 2020 US Women’s Open champion, started her round with an eagle on No. 1 en route to five-under 31 at the turn. She had a mix of three birdies and two bogeys at the back to finish at six-under for the day.

“I took advantage of all the birdie putts that I had, and gave myself a lot of opportunities. But at the same time, (I) still managed to play smart out there. Again, with the conditions, it’s easy to get impatient,” said Ms. Pagdanganan, who avoided the blustery afternoon conditions on Oahu that kept a lot of the competitors from catching Ms. Kim.

Meanwhile, Clariss Guce also got off to a good start, turning in a three-under 69 for share of 10th heading to Round 2.

Dottie Ardina shot a 70 for a piece of 21st. Paris Olympics campaigner Ms. Ardina actually stumbled with two bogeys and failed to break par in the front but bounced back with an eagle-spiked four-under 32 in the back. — Olmin Leyba

PVL turns down Farm Fresh’s request to allow Fil-Am setter to play

FARM FRESH owner Frank Lao yesterday made a humble plea to the Premier Volleyball League (PVL) to allow Fil-Am setter Alohi Robins-Hardy to play in the All-Filipino Conference unfolding Friday at the PhilSports Arena.

“After the PVL draft, there was an agreement between me and Mr. Palou that Alohi (Robins-Hardy) can play provided that she presents a valid Philippine passport,” said Mr. Lao in a statement referring to PVL President Ricky Palou.

“That’s why I was shocked to learn that she can’t play unless she joins the PVL draft. It was really frustrating to know that they will not allow her to compete unless she joins the draft, which will happen next year,” he added.

Mr. Lao’s message was conveyed by Farm Fresh team managers Kiara Cruz and CK Kanapi-Daniolco and legal counsel Donn Kapunan in yesterday’s media briefer in San Juan.

But the plea fell on deaf ears as the league decided with finality also yesterday to stick with its earlier statement to have Ms. Robins-Hardy undergo the mandatory draft next year for players who haven’t seen action in the league regardless of age.

“Much as we would like Alohi to play, we have rules to follow. Our rules are very clear. Player Alohi must go through the draft,” Mr. Palou told The STAR.

Mr. Lao said they were also told to get the nod of the majority of its league members for the request to be considered. — Joey Villar

CSB battles lowly Letran

COLLEGE of St. Benilde (CSB) coach Charles Tiu is adamant that for them to realistically contend, it would need to show it on paper.

They have been doing it thus far and will have a chance to do more as the Blazers try to move closer from claiming a precious twice-to-beat Final Four bonus with a win over a slumping Letran on Friday in NCAA Season 100 at the Filoil EcoOil Arena.

“Getting that twice-to-beat incentive in the Final Four is one way to gauge how far we’ve gone,” said Mr. Tiu.

CSB has been untouchable at the helm especially in the second round where it has won all its first five games there including a 61-56 win over University of Perpetual Help last Oct. 30 that hiked its total to a league-best 12-2. — Joey Villar

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